Subtract.
Explanation: There are many ways to solve this problem. Let's see two ways we can solve it. Place Value We can think in terms of tenths: $\begin{aligned} &\phantom{=}40.8-32.3\\\\ &=408\text{ tenths} - 323\text{ tenths}\\\\ &=85\text{ tenths}\\\\ &=8.5 \end{aligned}$ Place value table Let's line up the numbers by their decimal places. Tens Ones $.$ Tenths $4$ ${0}$ $.$ ${8}$ $3$ $2$ $.$ ${3}$ Now, let's subtract each place value column. Tens Ones $.$ Tenths $\overset{3}{\cancel{{4}}}$ $\overset{10}{\cancel{{0}}}$ $.$ ${8}$ $-$ ${3}$ ${2}$ $.$ ${3}$ $\underline{~~~~}$ $\underline{~~~~}$ $\underline{~~~~}$ $\underline{~~~~}$ $8$ $.$ $5$ $8.5 = 40.8 - 32.3$